Mr Rudd said he had asked the ALP national secretary to report on the allegations against Mr Lake from his previous career in local government - particularly his conduct toward fellow councillors.

He said in a statement it was "inappropriate for Mr Lake to continue as the endorsed Labor candidate for Hotham.''

"The National Secretary has informed me that he is not satisfied that there has been full disclosure about these previous matters,'' he said.

"I cannot be confident that he has met the standards I would expect and demand from members of the federal parliamentary Labor Party.''

Mr Lake did not reply to calls. He resigned after the Sunday Herald Sun approached Labor HQ at 8pm with allegations ALP campaign officials had improperly used retiring member Simon Crean's printing entitlement to distribute election material in the seat.

ALP secretary George Wright said he was concerned by the allegations.

The Sunday Herald Sun has copies of material distributed in Mr Lake's name that included reply paid envelopes funded by Mr Crean's office.

Mr Robertson, who was standing for the Queensland seat of Kennedy, confirmed he had withdrawn his candidacy after calling Opposition Leader Tony Abbott "racist' and a bigot in an interview last week.

"All I've got to say is, I made an apology for what was said and my comments were not meant to be greater than what they were. I have nothing further to say about what happened.''

"But I will be supporting the Labor Party and Kevin (Rudd) until my last breath."

Of the electorate he had hoped to represent he said: "They have to help return a Labor candidate to this seat.''

Fadden MP and Coalition frontbencher Stuart Robert had called on Mr Rudd to sack Mr Robertson for breaking with the ALP's promised "positive" approach.

The ALP now faces a scramble to find suitable candidates for the key seats. Mr Lake had been considered almost certain to retain the seat of Hotham for Labor, which retiring veteran Simon Crean holds with a margin of more than 14 per cent.

Geoff Lake, who is running for the Labor safe seat of Hotham, has admitted he offered an apology to a fellow Monash councillor over a 2002 exchange.Source: News Limited

Mr Lake, a lawyer chosen to run to replace Simon Crean in the prized seat of Hotham, admitted he offered a signed apology to fellow Monash councillor Kathy Magee over a 2002 exchange.

"I leant over to Councillor Magee and ... said, "I can't believe what you did you f------ b---h. You are a f ------ for doing that," Mr Lake confirms in papers.

Documents lodged with the Victorian Equal Opportunity Commission included an admission that his conduct had been "demeaning and degrading", and offensive to women.

Mr Lake said he deeply regretted his remarks.

"It was 's---t' or 'b----'. It was inappropriate," he told the Herald Sun.

"She said she was $30 out of pocket and I said, 'Look, Kathy, let's not have these disagreements. Here's $30, and let's move on."

Documents also reveal that in 2003 another fellow councillor, Tom Morrissey, accused Mr Lake of stalking him, and sought an intervention order.

In an application to the Magistrates' Court, Mr Morrissey, who has since died, said Mr Lake distributed his mobile number, alleging he had travelled at ratepayers' expense, which prompted dozens of abusive calls.

And he accused Mr Lake of parking a car at his business with placards repeating the claims.

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